February 12: The government has handed the responsibility of importing sugar to the private sector industries after the failure of state-owned companies to import sugar at subsidized rates. The government took such a move to ease the sugar supply in the country.

The decision comes after the Food Management and Trading Company Limited (FMTC) and Salt Trading Corporation (STC), which were entrusted the responsibility of importing sugar, failed to do so.

Bottlers Nepal, Dabur Nepal Pvt Ltd and some other biscuit industries have been given permission to import 25,000 metric tons of sugar, said Gajendra Kumar Thakur, joint secretary and spokesperson of the Ministry of Industry, Commerce and Supplies.

According to him, Bottlers Nepal has been granted permission to import 15,000 metric tons of sugar. Similarly, Dabur Nepal Pvt Ltd has received permission to import 6,000 metric tons and various biscuit industries have been granted permission to import 4000 metric tons of sugar.

The ministry sent a letter to India on July 21 ahead of the festive season to supply 50,000 metric tons of sugar through the G2G process. In response, India sent an email informing that it is ready to supply 25,000 metric tons of sugar to Nepal. The government entrusted FMTC and STC to import sugar with an exemption of 50 percent customs duty.

These two state-owned companies tried to import sugar before Tihar, but they have not been able to import sugar yet.

"That's why the ministry has entrusted the responsibility of importing sugar to the industries since the objective of the ministry is that the supply system should be balanced anyway," said Thakur.

Thakur clarified that those industries will be able to import sugar with customs exemption. 

It has already been one and a half months since the ministry gave permission to the industries to import sugar. However, even the industrialists have not been able to import sugar yet. Thakur informed that the industrialist have not come into contact with the ministry after receiving the permission. "Even the ministry has not shown any concerns about the status of sugar imports,” Thakur added.

According to the spokesperson of STC Kumar Rajbhandari, the company called for tender bids after the government assigned them the task of importing 10,000 metric tons of sugar. However, since the price quoted by India was too high, no company submitted proposals to supply sugar.

"That's why we have not been able to bring sugar," said Rajbhandari.  Currently, the STC is buying and selling 10,000 metric tons of sugar from local industrialists.

Consumer rights activists have accused the government of not being able to bring sugar because it fell in the trap set by middleman. Madhav Timilsina, president of Consumer Rights Forum Nepal, said that if the industrialists bring the sugar, the supply arrangement in the market will be easier. After the industries that consume large quantities of sugar import it themselves, the sugar they buy from domestic sellers will be channeled to the consumers. However, Timilsina says that it will be easier to control the erratic prices in the market if the government itself imports sugar.

About 280,000 metric tons of sugar is consumed in Nepal every year while the country produces 150,000 metric tons of sugar. Nepal imports the insufficient amount of sugar from India.